When investment increases,the ________ in aggregate demand is ________ the change in investment.
A)increase;greater than
B)increase;smaller than
C)increase;the same as
D)decrease;the same as
E)decrease;greater than

Question

Quizplus · Accepted Answer

Investment is a component of aggregate demand. Therefore, when investment increases, the total aggregate demand in the economy will increase as well. The increase in aggregate demand will be greater than the increase in investment, as the multiplier effect will come into play. This means that the increase in investment will lead to a larger increase in income, consumption, and ultimately, aggregate demand.

When Investment Increases,the ________ in Aggregate Demand Is ________ the Change

When Investment Increases,the in Aggregate Demand Is the Change